Magnolia considers $4.48 million budget, lower tax rate

Magnolia City Council considered a proposed $4.48 million budget and a decrease in the tax rate at its budget workshop Aug. 10. The budget is more than $1 million higher than last fiscal year’s budget, which was $3.45 million, according to city documents.

“We’re being as frugal as we can,” City Administrator Don Doering said. “This budget is actually trying to prepare us for the future.”

Doering said the city is planning to decrease the tax rate to around $0.4 per $100 valuation, but it has not agreed upon a rate just yet. The rate for the ongoing 2020-21 fiscal year is $0.4529 per $100 valuation, according to previous Community Impact Newspaper reporting.

Sales tax, building permits and utility impact fees are driving the budget increase, Doering said. The city is anticipating the sales tax revenue to increase by $600,000 to total $1.8 million in the upcoming fiscal year, the proposed budget shows. Revenue from permits is expected to increase by more than $300,000 as well.

Doering said the growth the city has seen is helping it fund needed improvements and utility expansions.

“We are adding some much needed equipment, but basically it’s a very conservative budget,” Doering said. “We are just very thankful for the financial situation we’re in.”

The budget includes funding for three new public works vehicles, totaling $84,722; a $120,000 metal building at the sewer plant; and a nearly $75,000 increase in inspection services. The budget also includes a 3% salary increase for the police chief, administrative personnel and public works employees, according to city documents.

The proposed budget also funds the hiring of an additional police officer. Doering said this officer would help mitigate some of the traffic issues the city has been dealing with.

Doering said the city is planning to approve the budget and tax rate in September before the fiscal year begins Oct. 1.